Season 12: Tear Down The System

Ryan: I’m about tearing the systems down that do not work and rebuilding them to support everybody.

Elizabeth: It almost feels like you need to change a whole system.

Cyan: I really do not like the education system and I would really love for it to be destroyed.

Khayla: We can build a healthcare system where we keep black women alive.

I’m Josh Muccio, this is The Pitch. And on season 12, we tear down the system and rebuild. This time we’re giving everyone access.

Julia: Democratize college admissions and allow every student to put their best story forward

Ryan: Democratize access to care

Philip: Help everybody create generational wealth

Jorge: We build technology that makes any mobile app work without the internet. // We are a tool that basically promotes free speech

Josh: Lotta democratization this season.

Cyan: Right?

This season of The Pitch will blow your mind. And… if you’re one of the investors on our show, your wallet.

Charles: I’m in for 25k

Cyan: I'm in for 50k personally. 

Mac: I’m in for 50k. Hell, if I had it, I’d give it all

Elizabeth: I’m in for 150k

Ben: We'd love to sneak in a quarter million into that same round. 

Jesse: We typically write between one and two million dollar checks

Cyan: If I were you, I would take the rest

Josh: Rest of her round?!

Elizabeth: Yeah, yeah

I’m ready to put on my valuation cap and go all in.

Charles: Getting worried about my job security now that Josh has like moved over to this side of the table

Jesse: Right, I know!

Mac: Look, every season, quality’s gotten better. Like your team, your sourcing team? Gotta watch out.

Season 12 of The Pitch starts in just two weeks on August 14th. And we’re doing something different this season.

We’re publishing the best pitches from our summer cohort, as soon as possible. So that you, listeners can experience the story as it plays out in real time. Some of you may even become a participant, because the deal will still be alive. 

There will be no follow up at the end of each episode, because at the very end, one crazy season finale will wrap up every story.

This season is going to look and feel demonstrably different from any of our previous seasons.  But I hope you’ll go on this journey with us. 

It is in fact, our best season yet.

14 pitches start August 14th, mark your calendars and turn on notifications for The Pitch on your podcast player of choice. Or on YouTube at The Pitch Show.

See you in two weeks.

Oh and if you’ve ever wondered what happens behind the scenes at one of our events, here’s a little bonus for ya.

Josh: Alright, here's the question. I'm gonna start with Charles. I’m going to pick on you. What was your very first investment, and what happened to the company? 

Charles: At precursor or ever? 

Josh: Ever. 

Charles: Ooh. Uh, like that I independently made? 

Josh: Yes, let's go with that. 

Charles: Uh, it went out of business, but I've invested in that person three times. I'm 0 for 2 and 1. The current thing I think is going to be the one that works. 

Elizabeth: Nice. Yeah

Charles: it was a hardware company.

Josh: It's conviction on a person.

Charles: Yeah, it was a hardware company. Like, the things you do as an angel that no one can talk you out of. It was a very difficult hardware company. 

Josh: Can you say the name of the company?

Charles: Uh, I mean, I probably, I probably could. I don't think he would be upset. It, uh, the company made a product called the gTar. 

Josh: gTar? 

Charles: gTar. 

Elizabeth: Is it, is it a guitar of sorts? 

Charles: Uh huh, yeah, yeah. Yeah. Yeah. 

Josh: Did we have them on the show? 

Charles: I don't think you've had them on the show. 

Josh: Okay. We had a guitar pitch on the show. We never aired it. 

Charles: Anyway, really talented founder. Mm-Hmm. . 

Elizabeth: That's cool. Is he still doing hardware then? 

Charles: He did a VR company and now he's doing stuff that is like, thankfully mercifully, not hardware. . 

Elizabeth: I see the progress. 

Josh: It took him a little while to get there. , 

Elizabeth: Hardware is so hard. Part of me always feels a little sad.'cause I, we all know academically that hardware is hard, right? But. Sometimes you just also need that in the world. I know. Somebody's got to do it. 

Charles: We still do 5 to 10 percent hardware. 

Mac: Just keep sending them to me. Keep sending them to me. 

Charles: Yeah. It's just unforgiving. That's the problem. Software is way more forgiving.

Elizabeth: Yeah. Yeah. 

Josh: Yeah. By far. Yeah. Elizabeth, how about you? What was your very first investment? 

Elizabeth: Hmm. So long ago, I'm not even sure which one was the first. I, I think it was in an SPV. That 500 startups was running. I think, I think it was Wanderable.

Josh: Wanderable?

Elizabeth: Wanderable. Yeah. And now actually that I'm kind of blanking on exactly what they did. I want to say it was some sort of trip registry. 

Josh: Okay. Like one of those travel…

Elizabeth: I knew actually, uh, both of the founders from many years, even prior to that, and they're really good operators. Um, that company had an exit to Airbnb. It was, um, I think it was okay. Didn't lose money. Um, but I also, I think only put in a thousand dollars and uh, yeah. And I think the, one of the founders is still at Airbnb. 

Josh: Wow. Mac?

Mac: So the first investment that I brought in, in, and led that I got across was, it was like my third week. Inventure working for the state of Maryland. And I met this founder at a local, um, uh, co working space. It was a company called Osmosis. And what they did was they would take, um, they took notes from, um, it was a platform for medical students.

And so they basically take all your notes and digitize them and turn them into like these, uh, daily flashcards and um, turn these medical terms into like these whiteboard, um, um, Definition charts of videos that they would do. Um, the company had grown like crazy. I think the Udemy's like, um, medical staff had left.

So he hired their entire team to do his tech. And at the time they had a partnership with, um, Wikipedia or in certain medical terms, it was their whiteboard videos that would come up. And the founder did not want to take any money. He didn't care about venture. He was like this super smart guy who had gotten, he was getting a degree from Johns Hopkins and an MBA at Stanford at the same time, kind of a thing.

And I was just like, Oh yeah, you should take this money. So I. Again, I'm like three weeks off the job and I'm explaining to him like the power of this money How he could grow faster. The state of Maryland does the deal the company starts growing moves to Colorado. When they move to Colorado the state of Maryland asked for their money back With just the interest so no real upside.

Josh: Yeah

Mac: and Four years after that, so I guess two years ago. They got acquired. So my very first investment was an exit.

Josh: Good exit, but you got nothing from it

Jesse: That was Shiv, right? 

Mac: Absolutely nothing. Yes, that was Shiv. Shiv's amazing. 

Jesse: He's great. 

Mac: So that was my first investment. So one for one, my next three all went to zero within six months.

Josh: Jesse?

Jesse: Uh, so my, I guess my official first time I ever wrote a check into a company would have been into WeWork as I was starting to work without him there. So that was, that story has been written. It was up and then it was down. Now it's down.

Josh: How early were you? 

Jesse: So I got involved when we were like four people in 2010 and so, um, we had not raised any money yet. We, we were, uh, we had our first floor in Soho at Grand and Lafayette. I'd say my first like company that I wasn't more deeply involved in was, uh, we were just talking about, but Squire was the first angel deal I did and they went and pitched like every venture investor, everybody passed and I wound up writing their first hundred grand into the company.

Mostly because they, um, you know, we use the term hustle a lot. They were hustlers. They were really strong. They're really smart. Um, but they found a way to share one hot desk in WeWork. And so they would come in, one of them would pay a very small amount, take a desk, invite the other one in as a guest every day, and then they'd stay until the staff left and they'd work in a conference room until like three or four in the morning, every night. So they got like two people full time for. I don't call it a hundred bucks a month. I was like, that's pretty good.

Josh: So you’re in WeWork seeing these guys just hustle and grind. You're like, I got to write a check.

Jesse: Yeah, exactly. So they're still, they're still running today. They're that, that's one of my best performing on paper investments. We'll see. It's at 160 X my cost basis, but, uh, we'll 

Elizabeth: Nice. Yeah that’s a good one. 

Jesse: We'll see. We'll see. Yeah. 

Josh: And what do they do real quick? 

Jesse: Uh, they're a platform for barbershops to both manage their business and, and attract customers. They started as like a marketplace to find a barber. Right. 

Elizabeth: They're a YC company, right? 

Jesse: They did wind up going through YC later. Yeah. They were, uh, they, they tried a lot. They went through a lot of accelerators, a lot of programs. There's no straight path for this thing. 

Josh: Cyan, how about you? 

Cyan: Um, first I'll say I'm extraordinarily lucky to have this one. Um, But SpaceX. 

Josh: That was your first check?

Cyan: It was my first check. At the time you just keep in mind that rockets were still blowing up on the launch pad and Our friend Luke Nosek came over to our house and he was on his knees crying saying, you know I can't get anybody to give me money Like, do you guys have any money in your couch? Like, like what money do you have?

And everybody's looking at me and I was like, cause we had just exited from, um, Ironport to Cisco and, uh, And so I was just like, well, here goes nothing. And basically everything that I made from that acquisition, I just rolled it over into SpaceX. 

Elizabeth: Oh, wow! You rolled all of it? Holy cow.

Cyan: All of it over into SpaceX. And, um, cause I thought at the time I was like, I'm young, you know, we were young, we were alumni there together and I was just like, I, I have a bit of a safety net now I can, I'm employable. So, cause I thought at first, like, should I go to the stock market? Should I buy land? Should I? My husband's like, no, and he's like do what we all do. And he's like give it to Luke. So Luke was raising an SPV and one of the first SPVs that there weren't that many back then and he was going to every single person like just begging. And the the conviction that he had, he was just like Elon Elon this yeah, I was just like, okay So I talked to some NASA engineers and I was like, all right.

Well your goat here goes So that was definitely a, we'll see for a long time. Yeah. And every time, you know, obviously like there's like a news event or whatever, you're like, we'll see. 

Jesse: Google alerts are just like on fire! 

Cyan: But you just can't be tied to any outcome with it. You just can't really think about it that much. But it, um, extraordinarily lucky to have, you know, the friend group that we have and to be at that place at that time and to be able to make that decision. 

Josh: Yeah.

Elizabeth: Well I find the conviction to put it all in. 

Cyan: Yeah, I went all in. 

Josh: Dude, that's crazy. 

Cyan: Yeah, I was just like, you know, Um, I slept under my desk. I worked hard.

Charles: We all worked hard there. That was a tough company to work at. Every other Saturday. 

Cyan: And yeah, you were at Ironport. We were there together. 

Charles: Yeah. 

Josh: What? 

Cyan: Yeah, we're alumni together. 

Charles: Yeah. 

Josh: I did not know that. 

Cyan: Yeah. So we all worked there together for years. 

Charles: That was an intense place.

Cyan: was a very intense place. 

Josh: Was this both your like first jobs in tech? 

Cyan: No. No. 

Josh: When was this?

Cyan: Charles went on to do like a lot of really amazing game stuff.

Charles: I joined in 05. 05, yeah. 

Cyan: 03. Yeah. For me. Um, but yeah, it was a very intense, very, very driven, um, type A personality. Yeah. Yeah. Uh, but probably one of the best companies I've personally, I don't know what you're Also like the  alumni, the exec alumni of like all gone on to do like amazing things, amazing things.

Charles: Schlamp and Weiss and all those guys. Yeah. Extraordinary people.

Cyan: It was probably one of the best companies that I've ever worked out for sure. And um, you know, and, and so I just really felt like I'm going to take this risk as Thanks. All these wise people around me do this. 

Jesse: And I mean, it's a rocket. Like if we're right, we're going to space. We're going to space. 

Josh: Did anybody tell you, Hey, Cyan, maybe don't invest all your money in this?

Cyan: No.

Josh: No one told you otherwise? 

Jesse: You're surrounded by great people. 

Cyan: Like go all in, just everything, just all, but keep in mind that these guys like often. They're wealthy on paper, but they often have no money.

Josh: So if you have money you should go all in?

Cyan: That's what Elon and all these guys believe. Elon lives in a trailer. That's not a joke. He sleeps on my friend's couches and goes to their houses. That's also not a joke.

Josh: That’s so weird. 

Cyan: Every, all the money that he makes he puts right back into his companies. 

Mac: Yeah. 

Elizabeth: Yeah. 

Charles: Sounds like running a venture fund.

Mac: A hundred percent. 

Elizabeth: Yeah. I mean I think his story like he is Like it was very touch and go.

Cyan: Like same thing with luke nosak Who was one of the founders of founders fund like he constantly every bit of money he makes he gives it to elon You know like literally just goes into Elon's companies and stuff that Elon does, um, or founders that have a lifelong vision.

And so sometimes like, it's, it's interesting because sometimes people will see like the PayPal mafia, like, how could you not afford that? And they're like, well, cause I have no liquidity. 

Jesse: Yeah

Cyan: I just put it all in to something. Um, and I do admire them for that. I admire that they, they look at these moonshots and they basically put everything into it. And they taught me that.

Josh: Yeah, you went all in on a literal moon shot.

Cyan: On a moon shot.

Elizabeth: Do you agree with that? That, that sort of investment philosophy.

Cyan: That's how Scott and I live our lives. Um, we are evergreen, uh, every exit we have, we deploy it right back into the ecosystem. You know, a lot of people like to lecture us, like, why don't you just sit on a beach and drink Mai Tais?

And it's like, well, I'd rather change the world. You know, I'd rather put all this money to work. And, um, and it does mean that sometimes our life looks a little weird because people are just like, you know, how could you struggle? And it's just like, well, sometimes companies aren't going public, you know, they’re not getting acquired.

Jesse: The last few years were tougher.

Cyan: Yeah. And they're tougher. And, and so I think, um, you know, there's a lot of talk about out there about people who are high net worth or whatever, like not using their money to create jobs, but obviously they are, you know, and, and I think it's just sort of a misunderstanding of that. But anyway.

Josh: Sure. All right. That was great. I enjoyed that a lot. Okay, so we gotta, we're gonna reset. So if you guys need to use the restroom real quick, we're gonna bring in the founder.